Let’s say you’re our client and you want to calculate ROI on branding initiatives, what’s the best way to go about this?
When it comes to business or marketing, we first want to approach it from an economic standpoint. Asking questions including, ‘was that a good investment’, or ‘what else could I have spent that money on?’ are the types of ‘hard’ metrics we are always seeking for clients for their brand marketing.
What is the return on investment?
On the other side, you’ll often hear from your marketing team, ‘If you advertise with us you’ll get some goodwill’, ‘people will associate your brand with luxury’. These are ‘soft’ or other important components that aren’t easily quantified or measured.
Don’t get me wrong, these things are incredibly important, but if that’s what your team currently utilizes as how to determine the effectiveness, you’re seeing part of the picture but you’re also potentially flushing money down the toilet.
Often during CORE or your annual marketing and business strategy meeting, you’ll hash out goals, i.e. ‘what do you want your brand to feel like?’ ‘What would people describe your brand as?’
But really it needs to be taken a step further by asking, ‘If we improved brand awareness, how would that impact our bottom line?’ Tying your marketing into revenue will give you those ‘hard’ metrics to tell you if it was worth your time and money.
In order to do so, we are going to provide you with techniques that’ll blend these soft metrics with hard metrics to really get a sense of how you can measure the effectiveness of your branding initiatives.
1. Brand Surveys
Brand surveys can be created using a service like Survey Monkey.
Completing these during regular intervals allows you to evaluate the changes in brand awareness. You can quantify the results by assigning a value to each response, and then adding these up.
How does your score change before a logo redesign? What about after? We’ve recently just implemented this ourselves by sending out customer surveys internally.
Once you’ve done these frequently enough, you generate additional insights including how seasonality trends are impacted, the familiarity with our brand in 2015 version and presently.
If you’re a small business, you might not know how you can get the public to fill out these surveys. We suggest offering incentives in exchange for their honest feedback. Using Hiilite services, for example, in exchange for filling out our survey, enters you into a random draw to receive an SEO audit on your website.
2. Direct traffic visits
The second way we can measure the impact of branding exercises is with direct traffic visits. If your website’s analytics are properly configured, then you can accurately track how many people are coming directly to your website. This tracks the people who are typing in your URL directly in their browser, opposed to traffic coming from an ad or a Google search. If website’s analytics aren’t properly configured, you should’ve set that up yesterday, and we can help with that.
Direct traffic is essential because it tracks people that are aware of your brand enough to know your website and seek it out.
Now how do we take this a step further to calculate ROI?
If your web analytics are properly configured, it’ll track the number of leads, sales and revenue that these direct visitors are responsible for.
From there, we can easily measure and calculate your ROI. For instance, if we paid $10,000 for a new logo and our direct website traffic increased 2x for the year, annually, and the revenue generated was $20,000. We can see you’ve generated $10,000 more than it cost. Simple.
What if you aren’t only online but you have a physical store location?
A few suggestions here:
First, you can install a device that tracks the number of times a door opens. Compare the numbers over time. Again, we would need to make a few assumptions here but generally this can give us some insight on the success of brand marketing as more visitors equals more brand awareness.
Lead to Sales Timelines
Second, if you have a good up-to-date CRM you can monitor the speed it takes to convert a lead to a sale. In general, we can assume that with increased brand awareness, comes quicker sales. If it took 14 days on average to close a deal but after some earned media attention because your brand is awesome and now it only takes 7 days, we can attribute that to greater brand awareness due to your efforts.
Finally, promotional materials are an effective way to boost ROI. For instance, providing a discount to those who come to your store and mention a billboard message that you paid for when they complete a purchase. Compare sales before and after. You get the idea.
Make sure you have proper reporting systems in place. And constantly work use the circular framework of measuring
reporting –> analyzing –> optimizing –> measuring to improve your branding ROI.